The New Deal was a series of economic programs implemented in the United States between 1933 and 1936. The programs were Roosevelt's responses to the Great Depression, and focused on the '3 Rs': Relief, Recovery, and Reform: Relief for the unemployed and poor; Recovery of the economy to normal levels; and Reform of the financial system to prevent a repeat depression.
A. Economic Policies
The Economy Act was passed on March 14, 1933. The act proposed to balance the "regular" (non-emergency) federal budget by cutting the salaries of government employees and cutting pensions to veterans by fifteen percent. On March 9, Roosevelt sent to Congress the Emergency Banking Act, drafted in large part by Hoover's top advisors. The act was passed and signed into law the same day. It provided for a system of reopening sound banks under Treasury supervision, with federal loans available if needed. Three-quarters of the banks in the Federal Reserve System reopened within the next three days.
B. Expanded Role of the Federal Reserve
One of the major causes of the Great Depression was how the US Federal Reserve caused a shrinking of the money supply after the stock market crashes which greatly exacerbated the economic situation.
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